Tag Archives: RGLD

______________________________I’m sitting here in my bunker having given up all hope for the country. Pass the cheeba. Pass the wine. Pass the Ritz crackers. We’ll be here a while, so relax a bit.

I must admit I’m amazed at the resiliency of humanity. I’m amazed at the tendency for things to right themselves through natural and perhaps quasi-divine processes. I guess, like physics, economics have laws that cannot be contravened, though perhaps they can be more easily bent for a period. We can rest assured, however, that like gravity’s effect on a rubber ball bounced off the tarmac, we are assured of a rebound by nature.

One true economic law is you will get what you incentivize, if you will forgive me that vulgar neologism. When this country was formed it was a haven for the oppressed and those seeking a new start, true. But it was also an immediate draw for those whose nature tended towards the burlesque, the hustle, and even the long con. The rule of law was late to the game and sometimes absent, so those who survived even in the great cities of the 18th and 19th centuries did so on wit, courage and often times some manner of guile. That formative chemistry served us well for almost 150 years and provided us not only with the capital, but the innovative drive to subdue the wilderness and become traders on a scale never before seen in history. Our frontier justice and hustler’s creed, in a sense, turned a soup of opportunity into a civilization whose standard of living surpassed those of the wealthiest Romans and Turks at the apex of Empire. All of that success a result of incentivized behavior.

After less than 150 years, we turned to the Age of Statism. It is no modern age, of course but rather one visited and revisited by mankind numerous times over the course of his recorded history, and now so again in America. The draw of Statism reflects man’s nature — his desire to consolidate power and impose his will upon the many. Dressed as chivalry and noblesse oblige prior to the Enlightenment, this will to control comes dressed in similar patronizing robes today — first for your children and later ensuring your eternal childhood.

The statist door, cracked by Wilson, thrown open by FDR and later Johnson and Nixon, is now blown off it’s hinges by Obama and his club of cronies. The Constitution, once the citzenry’s protection against such thuggery, now lies in tatters, largely ignored if not openly mocked. Where our originating culture had once incented hard work and innovation, our new state insinuated the easy out of the dole and the forgiving excuse of eternal victim-hood. Corruption became not some invasive element to be combatted, but a necessary institutional tool as it has been for centuries in lesser governments the world over.

What lies ahead for us, amidst the foundering bread and circuses, as the microcosms of statist corruption– the Detroits, Chicagos, and San Bernadinos — silently implode under the weight of their diseconomic burdens?

Are these municipalities harbingers of a greater collective future?

Will the country split?

Or will we reform under a renewed interest in localized solutions and community building?

I can only hope for the latter as I prepare to cope with an increasingly sclerotic and burdensome, top-down authoritarian system that will be punctuated by misery, increasing poverty and failing infrastructure. Compound interest can be a terrible thing when arrayed against your interests. And that interest is coming due, one way or another my friends.

_______________________________________

Ben said he wasn’t going to allay his QE moves today. “Surprise Suprise!” as Gomer Pyle was wont to say. Apparently, Ben is prepared to go out with a bang. Let’s hope it’s smaller than the Big Bang, eh? Concentrate on the high quality stuff for now. I was buying more AEM, RGLD and SLW today. Everything else will be increasingly risky, so you may want to just stick with the ETF’s. If you buy NUGT, make sure you have a call selling plan firmly in place. Same goes for AGQ. Best to you all.

I think gold’s flirtation with $1400 is drawing to a close, and we will soon join the great asset swell. I am thinking about a small “opener” in NUGT. I’m of the mind we will proceed to $20 with long due haste, where many gaps will be filled, to much rejoicing.

Then we will rest.

The nice thing is that we could get knocked back to $10 before the morning even starts, but that would be an even better launch pad. Play with stops at the lows. That is all.

And yes, even the dogs will have their day here soon, but why not start with the more quality stuff? RGLD, SLW and AUY, along with the dividend bearers (NEM and AEM my favorites).

Can Early Favorite Orb pull a “Big Brown” and win from the far outside post position?

___________________________________________________My apologies for not ringing in this week, but Derby Week is like Mardi Gras down here and I’ve a lot of responsibilities. Many of them include chaperoning Large Net Worths around, paying close attention to their words of wisdom, and occasionally matching them bourbon for bourbon, deep into the evening.

Gold an silver seem to be hanging in reasonably well, here, and $1,450 seems to be holding well. That’s a level to keep your eye on. In the meantime, I like AUY, NEM, AEM, and of course SLW and RGLD. All on sale now.

As for the Derby itself, I have to admit a certain loyalty to Rick Pitino’s magic horse, Goldencents, which, donning Kevin Ware’s #5 at Santa Anita, scorched the pack for the highest Beyer speed rating of any of the Derby preliminaries (105). Nobody else came even close to that in the Derby prelims, which lends the cold credibility.

I also like Normandy Invasion, and not just for the cool, retro-WWII name. I liked the way Normandy was making good time to almost overtake Verrazano in the Wood Memorial at New York’s Aqueduct Racetrack last month. That race was a mile and an eighth. I think with the extra 1/8 of a mile left in the Derby, Normandy should be sitting pretty.

Last I like the big winning colt, Orb… caution, this horse will likely be the favorite once all the Louisville Cardinal fans (Pitino’s GoldenCents) and multi-Derby winning jockey Calvin Borel fans (he will ride mud horse favorite Revolutionary) get too drunk to remember to bet by the 11th race. Orb has done nothing but win, and is coming off a sparkling win in the Florida Derby. The problem with this horse is it’s coming off the 19th hole, which has been a traditionally tough place to win from. Big Brown, however, won from #20 position in 2008 (see above) so anything is possible if you have a super horse. The question remains… is Orb enough of a Super Horse to win it?

Tune in tomorrow evening at around 6 pm on NBC! Look for me hanging off one of the balconies, hopefully not by one of my more delicate extremities.

Everything’s relative, I guess, including pain. Today’s revisit to the recent lows (and no, we’re not there yet) is not as painful as, say — a bloody compound tibial fracture jutting messily out of one’s shin. That said, it sure has been a frustrating six months, hasn’t it? And yet, if you look at all the major charts, it looks like at this late point in the cycle, the worst we are going to get is a revisit to the end of February lows, which — not insignificantly– were at the 200-week exponential moving averages for most gold and silver stocks. Royal Gold (RGLD) is still my favorite here, but you’d have to be crazy not to take advantage of the yielding plays available through NEM, AEM, and even ABX — and those are large caps you’d never see me recommending in a “normal” market.

But this isn’t normal. There’s a concerted, global (read Big 8) effort to devalue currencies — and therefore reprice debt — the world over. The only way those central banks can get away with this kind of routine, and save their debauched systems, is to get it done under cover of a “deflationary” scenario. The easiest path to that is to keep their foot on the less liquid large commodity and precious metal markets. This whole American Earl Revolution is a God-send to the central bankers, because it’s bringing supply on line in a period of global currency inflation. Ask yourself why oil prices have remained so stubbornly high, however, despite the onlining of so much new supply in the world’s greatest petroleum consumer.

How much longer can this kind of thing go on? Until the little guy cries “uncle” as loud as Soc Gen just did? Given that I was expecting a retest, and the large volume bars we saw at the late February lows, I am thinking this week and maybe the next will be the final washout. I’m still holding tight to my remaining cash, however. Like in late February of 2009, I don’t expect these prices to hang around for very long once the next cycle takes flight. That said, I think there will be ample time to take part once the bull trend resumes.

Best to you all, and Go Cards!

_____________________________________________

PS — this retrace is also an excellent time to buy some physical, if you’ve been holding off, including 100 oz silver bars and nice liquid gold coins like Maple Leafs or Eagles.
______________________

Let me caveat what I am implying here by saying first that I fully expect the commodity price of gold to test the late 2011 lows of $1523, and perhaps even undercut them to really get the blood flowing. I am prepared for that, as I realize the run to $1900 — much like the run to $49 in silver, was too far and too fast, even in a fiat printing, race to the bottom, currency bubble. But with the $Gold:$HUI index approaching 2008 crisis highs, and the $Gold:$XAU index now reaching an unprecedented height, I am copacetic about holding what I have while becoming poised for a final shake out where I can harvest some of my favorite names once again.

Opportunities abound in high quality names, some of which offer dividends while one waits (I’ve already added AEM, as you know). There’s no need to stretch on speculation, now, and look for any miners doing business outside the safe zones of Canada and the U.S. and Mexico for some silver plays. RGLD at these prices is insane, and if you are worried about this pullback, please review that company’s past charts over the last ten years. All of these stocks — yes, even the quality ones like SLW and AUY — have trod this rocky path before. In my opinion, these, along with their underlying commodities, preferably held in part in the physical bullion, will help you weather the coming storm in collective currency crisis.

If however, you believe that Ben Bernanke can be the first Federal Reserve Chief to successfully inflate the economy out of a low growth, value inhibiting recession, then perhaps your trust in this new bull is warranted. In my business, and in the entire economy, I see inflated prices for everything already, so the valuations of the stock market come as no surprise. As we approach major all time highs in the SPX, I am increasingly skeptical that we can continue without a major correction, just as I was in late 2007-2008, when we saw similar overwrought behavior. I may miss the final euphoric highs, as I did last time, but I will not end up like the Capo Vito, either.

To be sure, I am not telling you to buy these miners at this bloody juncture. Even I am holding off for the turn, as I mentioned a few times over the last month. But I would also counsel you not to short a bull, no matter how wounded. Bulls are mighty, long lived beasts, and despite their weariness, can leave one singing soprano with little to no advance warning.

Founded in 2007, iBankCoin is a provider of financial content with a distinctive voice. Through the unique personalities of its writers, the site offers a fresh perspective on financial news, and bold opinions on investment opportunities.